Bankruptcy?

tmrtink · May 2010

Has anyone ever filed before? Good or bad decision?

JenJar · May 2010

I've been told bad, but I'm anxious to hear the replies. It sounds like you and I may be in similar situations. Email me sometime if you want to vent and bounch ideas off one another. mrspate22 at yahoo dot com

dionnemd10 · May 2010

i have not--and hope to never have to, but i had 2 friends that had to during their divorce proceedings--due to one or the other of the spouses messing up the credit lines etc. both seem to have rebounded okay-since they are now both remarried, have new babies (with the past year and a half), still have their jobs, have newer cars etc. So not sure if it hurt them too much in the long run-but it could be that now things are under their new spouses too? i'm not sure. but again outwardly does not appear to have hurt them too much

duchess0727 · May 2010

Talk to a financial advisor. If you ever plan on buying a house or car, it's a bad idea because it will ruin your credit for a long time. Depending on what you owe, there may be other options where you can consolidate your debt and set up a payment plan you can live with. Bankruptcy is a serious decision and there are definitely long-term consequences.

MrsRebecca · May 2010

I haven't, but I think banruptcy should be an absolute last resort. I also don't think people should be allowed to file due to consumer debt.

Medical debt I understand, but if you ran up your CCs- pay them off like the rest of us did

Just my feelings.

shellyxo · May 2010

I had a friend who filed for Bankruptcy when she was 21 (she is now 28) and is still struggling with that life decision.

When I first met her.. I couldn't tell she had filed for bankruptcy. She appear content and nothing was wrong. However, after three years of being her best friend.. it became apparent in small ways how it controls her daily life.

She can't get a credit card and whenever an "emergency" comes up, she is in a worse bind than most people. She always have to ask others for help and can never get an apartment on her own. Without other people, she would be doom.

Not being able to stand on your own two feet is dangerous and you can't count on other people saving you..

brightning · May 2010

My aunt did and it took her about 15 yrs - if not more - to rebound. She couldn't get car loans, had to have other people sign for her utilities, etc. It was not the fresh start she'd been hoping for.

MrsRebecca · May 2010

MrsRebecca:
I haven't, but I think banruptcy should be an absolute last resort. I also don't think people should be allowed to file due to consumer debt.
Medical debt I understand, but if you ran up your CCs- pay them off like the rest of us did
Just my feelings.

Just wanted to clarify that I don't mean you personally, I mean you collectively.

notkateanymore · May 2010

It's a horrible idea. It ruins your credit for a very long time and makes it very hard to do anything like buy a car/house. I would really suggest trying to make it work, maybe you could get a job at night while your husband is home?

ash2 · May 2010

My mom filed and its awful. It stays on your record for 7 years for most things, like home and car loans, credit cards, etc. My mom works for the government and is up for her security clearance renewal next year. She will most likely lose her job because of the bankruptcy. I would never recommend it unless you have exhausted all other options.

MamatoJackson · May 2010

It totally depends on your specific situation. I filed a Chapter 13 Bankruptcy and I don't regret it. When my husband and I were dating and beginning to get serious, he had a lot of debt and was considering filing and I encouraged him not to. I think it really depends on your situation.

When I was 19, I had just started a job and was waiting for my three-month probationary period to be over so I could get signed up with the company's medical insurance. I was naive but healthy and figured it was no big.

Then the appendix came knocking. $30,000 later and here I was making $13/hour and... yeah, right. I threw $10 a month at the various medical bills when I could for a couple of years and waited to file bankruptcy because everyone kept saying how bad it was. I should have filed right off the bat but I waited until I was 23. At the time I made too much money to completely write it off and I wanted to keep my car, so I filed a Chapter 13.

Chapter 13 is where you pay the money back, but only a fraction of it, via monthly payments. My monthly payment is $250.

Is it difficult to get a car? A bit but you can... you just end up paying a higher interest rate. Is it difficult to buy a house? Yes, but you can... Difficult to rent an apartment? Yes, but you can - Just pay a higher deposit. I mean, it sucks, but so does having a buttload of debt in collections, you know? And at least with the Chapter 13, there was an end in sight.

Now, with my husband's debt... I looked at how much he owed. About $17,000. To me, that wasn't enough to file bankruptcy.

Take a cold, hard look at what you have outstanding, make a up a re-payment plan and then compare how long it would take you to pay that back (at a reasonable rate... you dont' want to be eating rice and beans for 5 years) versus how long a bankruptcy you would be making Chapter 13 payments (5 years, typically) and how long the bankruptcy would be on your report (10 years).

Good luck and if I can answer any other questions, let me know!

MrsRebecca · May 2010

MamatoJackson:
Then the appendix came knocking. $30,000 later and here I was making $13/hour and... yeah, right.

That's the kind of situation where I think bankruptcy is probably the best idea. Medical costs are outrageous and even people who have insurance can end up with these kinds of bills.

Even if you negotiate with the hospital, you'll still owe tens of thousands...and very few people have that kind of money sitting around.

spiritenergy · May 2010

My parents filed when I was in high school. It was a great decision for them. After my father not getting paid from a company taking them to court for his compensation and winning, then he still did not get paid because the company filed bankrupcy (there just wasn't enough to go around). Now my parents owed back bills and the lawyer. They were current on thier mortage so they decided to file chapter 13 to keep their house. It stayed on thier record for 7 years. They were able to buy a car after 3 years (they did have a healthy down payment). There is a lot of misconceptions out there right now about bankruptcy and foreclosure. Bankruptcy does not necissarily mean that you or your husband can not obtain security clearance. It can impact it, but it can go in your favor. If you are a walking financial disaster with lots of uncollected debt then that could look worse for your security clearance than a bankruptcy. If you are serious about it, then I would reccomend reading https://www.usafa.edu/superintendent/ja/bankruptcy.cfm?catname=JA and https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1494467 (this is one is about foreclosure but the psycology part of the paper is great). If you would like to PM me with more questions or just to talk, then please feel free.

beaches2bayous · May 2010

I filed Chapter 13 last year because of $37K in consumer debt- all of which was/is our fault. In Chapter 13, your income and other things, determine what you pay back, and for us, we have to pay back $33K. So we have a $640/month payment, which is no fun. However, that option is 100x than what I was facing. I had $10k on one card, and was making $500 a month payments (I had gotten way behind and wanted to catch up- DH got out of military and started a company, and it went ka-put). Anyway, credit card company agrees to $500 a month payments, but then decides a few months later (which they have every right to do) that they want $1100 a month, which was not going to happen on our salary. Needless to say, after many unfruitful talks with them, they served me papers and were suing me for the whole $10K. I talked to a lawyer about options (which I would definitely recommend before doing anything drastic) and he said they would win (since I did owe $10K and a credit card company can demand the total amount anytime after you default on a payment), which meant they would end up garnishing DH's wages- as in up to 75%. We would not have been able to survive financially. My point is, it's a very big decision and you need to talk to several financial/ lawyer ppl before making the decision. I would never have filed if I wasn't being sued, but I don't regret it. In 4 years, I'll have paid everything back, and in 7 years (10 years on some reports, I've read), it'll be off my credit report. p.s. Only I filed, because we thought DH's credit would then be better than mine, but I just checked both our credit scores, and mine's 15 points higher. Both our scores have gone up considerably since getting all the debt sorted out, because it's better to declare bankruptcy than to simply not pay people back. We also told our lawyer we wanted to pay 100% back to every debt, but your income (and other factors) decide that. Do your research, and be very careful about debt consolidation- check out Dave Ramsey's financial stuff- he's pretty drastic about paying cash for everything, but I WISH I had listened to that advice awhile ago. It would have made life much easier!

Andrewsgal · May 2010

MrsRebecca:

I haven't, but I think banruptcy should be an absolute last resort. I also don't think people should be allowed to file due to consumer debt.

Medical debt I understand, but if you ran up your CCs- pay them off like the rest of us did

Just my feelings.

I could not agree more. You bought it you pay for it.

Also I am sure I will get flamed to high hell for this, but you can bet your life on the fact that if DH and I were that bad off financially I would NOT be staying at home, and we would both be working 2 jobs aand not having more kids.

sabrina69barnes · May 2010

Andrewsgal:
MrsRebecca:

I haven't, but I think banruptcy should be an absolute last resort. I also don't think people should be allowed to file due to consumer debt.

Medical debt I understand, but if you ran up your CCs- pay them off like the rest of us did

Just my feelings.

I could not agree more. You bought it you pay for it.

Also I am sure I will get flamed to high hell for this, but you can bet your life on the fact that if DH and I were that bad off financially I would NOT be staying at home, and we would both be working 2 jobs aand not having more kids.

A few years ago I would have agreed with you 100% but now I'm seeing the other side of things. I don't have any debt but my DH has close to 40k. Over 34K of that is from lawyer bills from his divorce. He mistakenly hired someone who claimed to be a fathers rights lawyer and they took him to town. The lawyer kept asking DH if he could put a price on his children. Sometimes it makes more financial sense for a woman to stay home then it does for her to work and I'm one of them. I would spend more in daycare than I could make working.

MrsRebecca · May 2010

.

kcisthebombdotcom · May 2010

Andrewsgal:
MrsRebecca:

I haven't, but I think banruptcy should be an absolute last resort. I also don't think people should be allowed to file due to consumer debt.

Medical debt I understand, but if you ran up your CCs- pay them off like the rest of us did

Just my feelings.

I could not agree more. You bought it you pay for it.

Also I am sure I will get flamed to high hell for this, but you can bet your life on the fact that if DH and I were that bad off financially I would NOT be staying at home, and we would both be working 2 jobs aand not having more kids.

I'm glad someone else said this. The fact that there's people who have filed bankruptcy and are SAH is disturbing.

kcisthebombdotcom · May 2010

sabrina69barnes:
Andrewsgal:
MrsRebecca:

I haven't, but I think banruptcy should be an absolute last resort. I also don't think people should be allowed to file due to consumer debt.

Medical debt I understand, but if you ran up your CCs- pay them off like the rest of us did

Just my feelings.

I could not agree more. You bought it you pay for it.

Also I am sure I will get flamed to high hell for this, but you can bet your life on the fact that if DH and I were that bad off financially I would NOT be staying at home, and we would both be working 2 jobs aand not having more kids.

A few years ago I would have agreed with you 100% but now I'm seeing the other side of things. I don't have any debt but my DH has close to 40k. Over 34K of that is from lawyer bills from his divorce. He mistakenly hired someone who claimed to be a fathers rights lawyer and they took him to town. The lawyer kept asking DH if he could put a price on his children. Sometimes it makes more financial sense for a woman to stay home then it does for her to work and I'm one of them. I would spend more in daycare than I could make working.

Plenty of people work the opposite schedule of their spouse so they can avoid daycare. I worked the dinner shift at a restaurant from 4-12 and took home over $500 a week cash 10 years ago. Even if you had to find someone to watch the kids for a few hours a day if your shifts didn't perfectly overlap, it would still be 100 times better financially than not working at all. Many types of businesses-hotels, retail, call centers, restaurants, banquet facilities (just to name a few) hire 2nd shift.

tmrtink · May 2010

KC_13:
Andrewsgal:
MrsRebecca:

I haven't, but I think banruptcy should be an absolute last resort. I also don't think people should be allowed to file due to consumer debt.

Medical debt I understand, but if you ran up your CCs- pay them off like the rest of us did

Just my feelings.

I could not agree more. You bought it you pay for it.

Also I am sure I will get flamed to high hell for this, but you can bet your life on the fact that if DH and I were that bad off financially I would NOT be staying at home, and we would both be working 2 jobs aand not having more kids.

I'm glad someone else said this. The fact that there's people who have filed bankruptcy and are SAH is disturbing.

Not fair to say at all-especially when you don't know a persons individual situation, medical bills, and otherwise. Also, sometimes people get pregnant unexpectedly (WHILE using protection) but are still happy with the fact that they are having a baby. Sometimes babies have complications-list goes on and on. Things don't always turn out as we planned them to, and often times the options are limited.

kcisthebombdotcom · May 2010

tmrtink:
KC_13:
Andrewsgal:
MrsRebecca:

I haven't, but I think banruptcy should be an absolute last resort. I also don't think people should be allowed to file due to consumer debt.

Medical debt I understand, but if you ran up your CCs- pay them off like the rest of us did

Just my feelings.

I could not agree more. You bought it you pay for it.

Also I am sure I will get flamed to high hell for this, but you can bet your life on the fact that if DH and I were that bad off financially I would NOT be staying at home, and we would both be working 2 jobs aand not having more kids.

I'm glad someone else said this. The fact that there's people who have filed bankruptcy and are SAH is disturbing.

Not fair to say at all-especially when you don't know a persons individual situation, medical bills, and otherwise. Also, sometimes people get pregnant unexpectedly (WHILE using protection) but are still happy with the fact that they are having a baby. Sometimes babies have complications-list goes on and on. Things don't always turn out as we planned them to, and often times the options are limited.

I actually was making a general statement, and not referring to your specific situation at all. If you just got into some trouble with medical bills, I think that's a different situation than being financially irresponsible then filing bankruptcy and SAH.

I hope things work out for you and your child gets well soon.

funchicken · May 2010

MrsRebecca:
MamatoJackson:
Then the appendix came knocking. $30,000 later and here I was making $13/hour and... yeah, right.
That's the kind of situation where I think bankruptcy is probably the best idea. Medical costs are outrageous and even people who have insurance can end up with these kinds of bills.
Even if you negotiate with the hospital, you'll still owe tens of thousands...and very few people have that kind of money sitting around.

This is very true--an unexpected illness when you're un/underinsured can be devastating, but sometimes it is possible to work out a payment plan directly with the hospital.

Several years ago, I ended up with $15K in medical bills that my insurance wouldn't cover. I worked out a really reasonable payment plan with the hospital. I'd definitely try to negotiate and work out a payment plan before I'd consider bankruptcy even for medical bills.

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